Cadmium (Cd) is a pervasive toxic metal, present in most food types, cigarette smoke, and air. Most cells in the body will assimilate Cd, as its charge and ionic radius are similar to the essential metals, iron, zinc, and calcium (Fe, Zn, and Ca). Cd preferentially accumulates in the proximal tubular epithelium of the kidney, and is excreted in urine when these cells die. Thus, excretion of Cd reflects renal accumulation (body burden) and the current toxicity of Cd. The kidney is the only organ other than liver that produces and releases glucose into the circulation. Also, the kidney is responsible for filtration and the re-absorption of glucose. Cd is the least recognized diabetogenic substance although research performed in the 1980s demonstrated the diabetogenic effects of chronic oral Cd administration in neonatal rats. Approximately 10% of the global population are now living with diabetes and over 80% of these are overweight or obese. This association has fueled an intense search for any exogenous chemicals and lifestyle factors that could induce excessive weight gain. However, whilst epidemiological studies have clearly linked diabetes to Cd exposure, this appears to be independent of adiposity. This review highlights Cd exposure sources and levels associated with diabetes type 2 and the mechanisms by which Cd disrupts glucose metabolism. Special emphasis is on roles of the liver and kidney, and cellular stress responses and defenses, involving heme oxygenase-1 and -2 (HO-1 and HO-2). From heme degradation, both HO-1 and HO-2 release Fe, carbon monoxide, and a precursor substrate for producing a potent antioxidant, bilirubin. HO-2 appears to have also anti-diabetic and anti-obese actions. In old age, HO-2 deficient mice display a symptomatic spectrum of human diabetes, including hyperglycemia, insulin resistance, increased fat deposition, and hypertension.